Doing The Right Thing
This week’s reading assignment is based on one of my favorite authors. He is best known for his influential work in the field of leadership studies. Peter G. Northouse, PhD, is a renowned expert in the field of leadership studies. He is Professor Emeritus of Communication in the School of Communication at Western Michigan University.
Northouse book, “Leadership: Theory and Practice,” is one of the best-selling academic textbooks on leadership globally and has been translated into 13-15 languages. [1] This book is designed to help established and emerging leaders develop their leadership skills and understand the complexities of leading effectively in various settings. The book emphasizes that effective leadership is not a one-size-fits-all process but involves understanding and adapting to different contexts and individuals. It also highlights the importance of ethical leadership and the role of followers in the leadership process.
Leadership: Theory and Practice is one of the sources (secondary) I used for my NPO. The book provides a thorough overview of major leadership theories and models, making it a valuable resource for understanding the breadth of leadership research. I used the case studies theories to real-world scenarios. The consistent chapter structure allows for easy comparison and contrast of different leadership theories, aiding in critical analysis and synthesis of information.
Given the depth of the book, I chose to explore Ethical Leadership, the role of ethics in leadership and how leaders can foster ethical behavior within organizations. Chapter 15 presents the ethical dimensions of leadership, discussing various approaches to ethical leadership and the importance of ethical behavior in leaders.[2] It highlights the potential consequences of unethical leadership and provides strategies for fostering an ethical organizational culture. The chapter also explores the concept of the “dark side” of leadership, examining how power and authority can lead to unethical practices if not managed properly.
When I moved to the US, I worked for Enron Corporation. They offered me a great compensation with yearly generous bonuses. I never knew what was happening behind the scenes – a group of unethical leaders drove the company to the ditch. People lost their jobs, and so did I. I personally knew retirees from my department who lost all their retirement savings. I saw Joe Hirko, former co-chief executive officer handcuffed in front of the World Trade Center. Hirko was involved in the company’s failed telecommunications business and was sentenced to 16 months in prison for wire fraud. He made false representations about the capabilities of Enron’s broadband technology, which contributed to maintaining the company’s stock price artificially high.[3] One morning at 5:00 o’clock I got a call from my boss (VP of Portland Operations Division) that the office is closing, and we are getting laid-off. It was horrible! In the case of Enron, there was a major absence of consideration “respect for everyday people”, agreed, the abuse of power and the ego of thinking one can get away with unethical practices. Thus, Sarbanes-Oxley Act was formed to prevent such issues in the future.
One notable example of an ethical leader in corporate America is Howard Schultz, the former CEO of Starbucks known for his commitment to ethical leadership and putting employees first. [4] Under his leadership, Starbucks implemented various initiatives to support employees, such as providing health insurance, stock options, and tuition reimbursement. Schultz also emphasized transparency and ethical business practices, ensuring that Starbucks maintained a strong moral compass.
Takeaway [5]:
- Principles of Ethical Leadership: Understanding core principles such as respect, service, justice, honesty, and community, and how these can be integrated into leadership practices.
- Moral Development: Insights into how leaders develop morally over time and the stages of moral development they go through.
- Ethical Decision-Making: Frameworks and strategies for making ethical decisions, emphasizing the importance of considering the impacts on all stakeholders.
- Role of Character: The significance of a leader’s character and personal values in fostering an ethical organizational culture.
- Consequences of Unethical Leadership: Awareness of the negative effects of unethical behavior in leadership, including loss of trust, legal issues, and damage to reputation.
- Promoting Ethical Behavior: Methods for encouraging ethical behavior within teams and organizations, such as setting a good example, establishing clear ethical guidelines, and rewarding ethical behavior.
In conclusion, Northouse’s book, Leadership: Theory and Practice, is an essential resource for developing effective leadership skills. It combines comprehensive coverage of leadership theories with practical applications, emphasizing the importance of ethical leadership. The book highlights the critical role of ethics in leadership and its impact on organizations, illustrated by lessons from the Enron scandal and ethical leaders like Howard Schultz.
[1] Peter G. Northouse, Leadership: Theory and Practice, 9th ed. (Thousand Oaks, CA: SAGE Publications, 2022).
[2] Peter G. Northouse, Leadership: Theory and Practice, 9th ed. (Thousand Oaks, CA: SAGE Publications, 2022), 760.
[3] Charges and False Representations: FBI. (2009). Former Enron Broadband Services CEO Sentenced. Retrieved from https://archives.fbi.gov/archives/houston/press-releases/2009/ho092809-1.htm. Accessed December 2024.
[4] Sneha Chugh, “5 Best Ethical Leadership Examples to Seek Inspiration From,” Emeritus, https://emeritus.org/blog/5-best-ethical-leadership-examples-to-seek-inspiration-from/.
[5] Northouse, 760-763.
About the Author
Shela Sullivan
Born and raised on the vibrant Penang Island in Malaysia, I cherish the Malaysian greeting, “Mari Makan!!” which reflects the warmth of shared meals. Since 1996, I have called Oregon my home enjoying the raindrops and the serenity of its beaches. The ocean connects me to nature and energizes me. I am a Wife - Mentor - Traveling Pastor - Sourcing Manager Construction. Favorite Bible Verse: "Delight yourself in the Lord, and He will give you the desires of your heart." ~ Psalm 37:4~ I reside with my husband, David and our fur-baby Rolo. We share passions for travelling, culture, diverse cuisines, home improvements, classic cars and humor.16 responses to “Doing The Right Thing”
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Thanks for the insight in the book and also your reflection on Enron. How has your personal experience with the Enron scandal influenced your understanding of the importance of ethical leadership, and how might this perspective shape how you lead or evaluate leaders in the future?
Thank you, Glyn, for your question.
Awareness and transparency are so important. The scandal demonstrated how unethical leadership can erode trust within an organization and among stakeholders, leading to long-lasting damage not just to the company but to the industry as a whole. This reinforces the idea that ethical leadership is foundational to building and maintaining trust.
I allow my team to question me. “If you see something, say something.”
Hi Shela, Thank you for highlighting Northouse’s thoughts on ethical leadership. This has always been my priority, as I have experienced the negative impact of unethical leadership—although not to the extent you did! I remember studying Enron in a Business Law class. The story still makes me sick to my stomach. Thank you for sharing your experience. I know sometimes ethical people work for unethical executives. What practices do you maintain to remain ethical when directly affected by others’ unethical business practices?
Hi Elysse,
Thank you for your question.
Since Enron, I have worked for companies that values ethic. I address unethical behaviors right-away. Sometimes people are not aware so, it is only fair to give them the opportunity to explain. I held myself accountable, I own mistakes and be free from guilt and blame.
Hi Shela, I like how you gave examples of both ethical and unethical examples in your blog. In your current setting, can you see sign that would help you if the people in upper leadership of the utility are ethical or not? I think sometimes, like with Enron, unless someone was directly involved with the person running a company it is difficult to know. It was a tragic event.
Hi Diane, thank you for your question.
In my current organization, we have Ethics Committee to receive anonymous feedback. They take it very seriously. In addition, there’s bi-annual Glint survey.
Wow! Shela, that is a close and center view of Enron’s unethical leadership. What do you think changed in your leadership through this experience? As you read Northouse, what is one thing you want to apply?
Hi Kari,
Thank you for your question.
This experience has taught me to be transparent with my manager(s) and team members, taught me to own my mistakes and created awareness.
Shela, in your exploration of ethical leadership, you emphasize the contrast between the unethical practices at Enron and Howard Schultz’s commitment to ethical leadership at Starbucks. Given these experiences, what practical steps do you believe leaders and organizations can take to cultivate a culture of ethics that prevents scandals and actively fosters long-term trust and transparency?
Thank you for your question, Chad.
My current employer created a comprehensive code of ethics that outlines acceptable behaviors and decision-making processes. All employees are to commit to these standards and sign the document at the time of offer. Continuous yearly mandatory ethics training and bi-annual Glint survey about ethics.
Shela, I’m sorry you went through that experience at Enron. From this side of it, what did you take away from that experience that you now either implement or avoid in your current context?
Thank you, Debbie, for your kind words and for the question.
I think awareness is important. I work on procurement contracts. If I know the Suppliers/Contractors, I disclose it to the Ethics Committee.
Shela, thanks for your insights into ethical leadership, both from your personal experience and from Northouse.
In many ways leadership is about doing the next right thing. What are some of the questions followers should be asking to discover the ethics of an organization?
Thank you, Graham, for your question.
I tend to question the decision-making process; I work for a company that encourages “doing the right thing.”
We are protected under the “Whistleblower Act”. We have an Ethics Committee that takes complaints seriously. In addition, awareness is important as well as being in compliant.
Hi Shela! Thank your for your transparent post. Looking at the Enron scandal what route do you plan to take in fostering ethical behavior in your current or future leadership roles?
Hi Daren, thank you for your question.
Awareness and transparency are so important. The scandal demonstrated how unethical leadership can erode trust within an organization and among stakeholders, leading to long-lasting damage not just to the company but to the industry as a whole. This reinforces the idea that ethical leadership is foundational to building and maintaining trust.
I allow my team to question me. “If you see something, say something.”